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E-M:/ PEER Criticizes Michigan Pollution Trading



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Enviro-Mich message from "Alex J. Sagady & Associates" <ajs@sagady.com>
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PEER CRITICIZES MICHIGAN POLLUTION TRADING PROGRAM...

MORE CONTENT AT http://www.peer.org/press/233.html
WITH FACT SHEETS AND EPA MATERIALS


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Press Release

For Release: Monday, April 29, 2002
Contact: Jessica Vallette Revere (202) 265-7337

EPA IGNORES WARNING OF PHONY POLLUTION CREDITS
US TO APPROVE MICHIGAN AS FIRST "OPEN MARKET" AIR TRADING PROGRAM

Washington, DC - Overriding objections from its own Office Of Inspector 
General, the U.S. Environmental Protection Agency is set to allow the State 
of Michigan to conduct "open market trading" in air pollution credits, 
according to documents released today by Public Employees for Environmental 
Responsibility (PEER). Rather than improve air quality, internal reviews 
indicate that the Michigan plan will simply mask increased pollution, 
hobble enforcement and legitimize regulatory evasion.

In an internal memo dated April 5, J. Rick Beusse, the Director for Program 
Evaluation on Air Quality Issues for the EPA Inspector General, wrote to 
Jeffrey Holmstead, the agency's top air regulator, complaining that "EPA 
indicated that it intends to approve Michigan's OMT (open market trading) 
program" despite unaddressed weaknesses. More than three quarters of 
Michigan's most important credits are generated not by improvements in 
pollution control but by plant closures. The memo highlighted this issue:

"While in Michigan, we observed that approximately 23 percent of the 
State's total open market emissions credits generated - and 80 percent of 
its volatile organic compound (VOC) emission credits generated - have 
resulted from shutdowns…under Michigan OMT rules, when permitted sources 
close facility operations in Michigan and receive emissions credits for 
shutdowns, these same or similar facility operations may be restarted in 
other states…"

"EPA is desperate to embrace any market-based plan, even one that doesn't 
work," commented PEER Executive Director Jeff Ruch, pointing to the 
agency's embarrassment following the sudden collapse of New Jersey's open 
market program in February just as EPA was poised to approve it. "Until EPA 
tightens the rules, open market trading will just be a giant shell game 
played at the expense of public health."

Unlike traditional "cap-and-trade" plans, open market trading does not cap 
emissions yet it grants industries wide latitude to create, buy and sell 
emissions reduction credits across industrial sectors, pollution sources 
and even different pollutants. For example, under open market trading a 
company could increase its "smokestack" pollution by removing mobile 
pollution sources such as old cars or converting diesel buses to hydrogen.

The EPA Inspector General is currently investigating pending OMT plans 
following a complaint filed last year by PEER and the New Jersey Sierra 
Club. Last May, twenty major environmental groups petitioned EPA 
Administrator Christie Todd Whitman to fix an array of technical and 
regulatory problems before approving any OMT programs.

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Alex J. Sagady & Associates  http://my.voyager.net/~ajs/sagady.pdf

Environmental Enforcement, Technical Review, Public Policy and
Communications on Air, Water and Waste/Community Environmental Protection

PO Box 39,  East Lansing, MI  48826-0039
(517) 332-6971; (517) 332-8987 (fax); ajs@sagady.com
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